Introduction to Child Support
Second to custody and parenting time, child support and spousal support seem to be the next most contentious issues in a contested family law case with children involved. It is easy to see how resentment can build when someone is ordered to make monthly payments to their ex-partner while at the same time struggling with their own separate household. It can be a challenging experience transitioning from supporting one household to now trying to support two separate households on the same income. These types of cases can easily spiral into a “one more piece of the pie for you is one less piece for me” grab-all-you-can mentality for both parents. And this mentality can become particularly dangerous when you factor in a built-in parenting time incentive in the child support calculation, as described below.
Calculating Child Support
Child support in Oregon is calculated through a complex algorithm detailed in the ORS and OAR. Fortunately for us all, this complex algorithm is expressed through an easy-to-use online calculator maintained by the Oregon Division of Child Support. It is free to use and available to the public, so you should use it to experiment with different possible scenarios, so that you have a better idea what the child support window may be in your case. You can find the child support calculator on the official Department of Justice, Division of Child Support website, at: https://www.doj.state.or.us/child-support/.
Although you will likely never know the minute details of how the child support algorithm works, you should still have a basic understanding of the principles behind it. At its root, child support is based on each parent’s proportional income in conjunction with the amount of overnight parenting time each parent has.
Fundamentally, the principal spirit behind child support is that a legal parent has a financial obligation to care for their child. Parents that are still together in a relationship typically do not file child support cases or go to court. Because these parents live together with the children, the law presumes that these parents are already both financially contributing to their child’s care. In cases where the parents are separated however, the child typically spends part of their time at each parent’s house and the parents no longer draw from a common pool of financial resources to pay for the child’s care. Therefore, when the parents are separated, that financial obligation must be properly apportioned to each parent.
When calculating the proper allocation of child support, it is also presumed that a separated parent is directly financially caring for the child while that child is in their care. So, the more overnight parenting time a separated parent has with the child, the less they will have to pay the other parent in child support, or inversely, the more support they will receive from the other parent.
The obligation to pay the other parent arises when the parenting time is not equal, and therefore the financial contribution for the care of the child is not equal, or when the parties’ incomes are so disproportionate that the parent earning the larger income has a larger financial responsibility of care, or sometimes it can be a combination of both.
For example, if the parties share a 50/50 parenting time schedule, and their incomes are the same or similar, then neither party would likely be ordered to pay child support to the other party. However, if either the income changes or the parenting time changes, then it could likely trigger a child support obligation for the higher earner or parent with less parenting time.
As another example, you can also look at it this way. Suppose Parent 1 and Parent 2 are each gainfully employed at good jobs. Parent 1 earn $6,000 gross per month and Parent 2 earns $4,000 gross per month. While they were both still living together in a relationship, their child received the financial benefit of a $10,000 per month household. Although they have now separated, the policy is that the child should still receive the benefit of both parties’ incomes, so the obligation is allocated based on income. In this example, Parent 1’s income is 60% of the pooled $10,000 and Parent 2’s income is 40%, so with all else being equal, that becomes the allocated obligation. If the parenting time were to change too, then the child support obligation would also likely further skew.
Although it makes logical sense, this parenting time incentive in the child support calculation can also influence a party’s position in the case. For example, it is not uncommon for a parent to want to fight for the lowest possible parenting time schedule they can for the other parent, even though the children’s relationship with the other parent will inevitably suffer as a result, because they know it means more money in their own pocket. And inversely, it also provides an incentive for a parent to fight for as much parenting time as possible, even if they do not intent to exercise it, because it ultimately means less money coming out of their pocket.
Income
So, now that we know child support is based on a party’s income and parenting time, what exactly is considered income? The short answer is almost everything. The definition of income for child support purposes is found in OAR 137-050-0715, and is a parent's gross earnings and income from any source, including:
(4)(a) Employment-related income including salaries, wages, commissions, advances, bonuses, dividends, recurring overtime pay, severance pay, pensions, and honoraria;
(4)(b) Expense reimbursements, allowances, or in-kind payments to a parent, to the extent they reduce personal living expenses;
(4)(c) Annuities, trust income, including distribution of trust assets, and return on capital, such as interest and dividends;
(4)(d) Income replacement benefit payments including Social Security benefits, workers' compensation benefits, unemployment insurance benefits, disability insurance benefits, and Department of Veterans Affairs disability benefits;
(4)(e) Inheritances, gifts and prizes, including lottery winnings; and
(4)(f) Income from self-employment, rent, royalties, proprietorship of a business, or joint ownership of a partnership or closely held corporation, minus costs of goods sold, minus ordinary and necessary expenses required for self-employment or business operation, including one-half of the parent’s self-employment tax, if applicable.
In fact, the only things not considered income for child support purposes is: (5) Child support, food stamps, Social Security or Veterans benefits received on behalf of a child in the household, adoption assistance, guardianship assistance, and foster care subsidies. Everything else is fair game.
Actual vs Potential Income
Additionally, not all income is equal. In addition to considering all sources of your actual income listed above, OAR 137-050-0715 also allows the child support award to be based on a parent’s potential income when that parent is unemployed or underemployed but is capable of earning more.
Potential income is defined in OAR 137-050-0715 as:
“…the parent's ability to earn based on relevant work history, including hours typically worked by or available to the parent, occupational qualifications, education, physical and mental health, employment potential in light of prevailing job opportunities and earnings levels in the community, and any other relevant factors. A determination of potential income includes potential income from any source described in section 4 of this rule. If a parent residing in Oregon is determined to be able to earn at the minimum wage, the hourly earning amount to be imputed as potential income will be based on the lowest minimum wage provided for in any area of Oregon.”
This basically means that if the court or DCS finds that you, or the other party, is capable of earning more money based on your education, skills, and opportunities, they will use that imputed potential income in your child support calculation, regardless of whether that party actually earns that imputed income or not.
This rule also applies to unemployed parties who may not receive an income at all. For example, if a party is unemployed, but there is no legitimate reason they could not be employed full-time at a minimum wage level job, then the court or DCS will likely use the lowest-tier minimum wage in Oregon as their income in the child support calculation. If you are the one paying support, that imputed income will likely reduce your obligation. On the other hand, OAR 137-050-0715 also states that potential income may not be used in cases where a parent is (a) unable to work full-time due to a verified disability; (b) receiving workers’ compensation benefits; or (c) incarcerated.
This is a nuanced rule, and you would be wise to read it yourself.
Rebuttals and Agreements
In addition to income and parenting time, a child support calculation can also be influenced by up to 4% by rebuttal factors and/or up to 15% by an agreement between the parties. Rebuttal factors can be found in OAR 137-050-0760 and Agreement factors can be found in OAR 137-050-0765.
A rebuttal may be used in a child support calculation to offset the presumptive guideline support amount if a party can demonstrate that the presumptive amount is unjust or inappropriate under the circumstances listed in the OAR. These are typically resource and hardship circumstances, so if you think any may apply then you should review the rule.
Parents are generally not allowed to agree to completely waive child support rights as it is considered against public policy, especially if the receiving parent is on public assistance. A convenient way to look at the issue is that it is not the parent’s right to receive child support. It is the child’s right and the receiving parent is acting as an agent on the child’s behalf. And when the child turns 18 and is otherwise eligible, the support will be paid directly to the child.
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